The research areas covered by the Alveolar Biology Program include: (l) definition of the structural and functional properties of the alveolar lining layer in the adult lung and also at birth; (2) investigation of the biosynthetic processes of the alveolar cells and subcellular components; (3) investigation of the interrelationship between alveolar epithelial cell metamorphosis, alterations of the surfactant system and selected pulmonary pathological processes (for example, O2 toxicity and O2 tolerance); (4) identification of the surfactant system in fetal pulmonary fluid, its maturation during fetal development and its formation of the alveolar lining layer at birth; and (5) studies of fetal pulmonary fluid and solute dynamics vis-a-vis the flux between alveolar space and pulmonary capillary in the developing fetus. Research highlights for the period of this report include: (1) Isolation and characterization of pulmonary secretory IgA and topographical localization of this protein in the lung; (2) development of isolation procedures that yield relatively large populations of Type II pneumocytes; (3) successful growth in culture of what appear to be pure Type II cell "cysts"; (4) identification of 2-lysolecithin receptor in the 2-lysolecithin transferase system as an important pathway for the synthesis of dipalmitoyl lecithin ("lung surfactant"); (5) discovery that the increased production of catalase (which is characteristic of adaptation to hyperoxic environments) is associated with an increased synthesis of a specific lung ribosome; (6) demonstration that sustained spontaneous fetal breathing ("onset of breathing") can be induced by somatic sensory stimulation alone; (7) discovery of the short-lived, transitional "foam lung" at birth which may explain the essential cardiovascular pulmonary adaptations of this period.